US restaurant chains saw annual sales growth slow to 3.4% in 2008 - due to a decline in consumer spending and increased cost pressures, according to new research.
The latest annual data on the top 500 US restaurant chains from Technomic showed that many companies had scaled back their expansion, growing units by just 1.8% compared with 2.6% the previous year.
The bakery-café, coffee and other beverage sector continued to see growth, with sales at Panera Bread up 16.2% and sales at Starbucks rising 6.9%.
But on the whole sales growth had slowed to 3.4% - down from a 5% fillip in 2007
Burger King led the hamburger segment with sales growth of 6.6%, while McDonald’s, the largest US restaurant chain, posted a 4.4% increase in sales to exceed $30bn (£20.9bn).
Subway continued to dominate the other sandwich sector, with a 17.1% sales growth and total sales of $9.6bn, significantly out performing other chains in the same segment that only saw growth of 9.1%, added Technomic.
Growth continued to be driven by fast casual chains, with Chipotle Mexican Grill and Qdoba Mexican Grill in the Mexican category posting sales increases of 20.7% and 17.8% respectively, and Wingstop and Zaxbys in the chicken segment seeing growth of 23.6% and 17.9% respectively.
Limited service chains, which account for over 80% of all US fast food restaurants grew at a rate of 4.5% and full service outlets grew at 0.9%.
Ron Paul president of Technomic, said: “As the US economy slid into recession last year, restaurant operators faced a host of challenges, including cost pressures followed by declines in consumer dining demand.”
The 10 fastest growing chains with sales over $200m, which in total accounted for sales of $4.9bn, a 24% increase on 2007, included: Five Guys Burgers and Fries, Jimmy John Gourmet Sandwich Shop, Potbelly Sandwich works, Noodles & Company, Wingstop, Peet’s Coffee & Tea, Buffalo Wild Wings, Chipotle. Pei Wei Asian Dinner and BJ’s Restaurant & Brewery.
Four chains with sales of over $2bn achieved double-digit growth in 2008 - Subway with 17.1%, Panera Bread with 16.2%, Chick-fil-A with 12.2% and Olive Garden with 10.2%.
